Thursday September 28, 2017

Bombardier hit with 219% duty on sale of jets to Delta Air Lines

OTTAWA—Bombardier’s hopes for breaking into the U.S. commercial aviation market took a massive blow on Tuesday, as the U.S. Department of Commerce proposed a hefty 219 per cent duty on its CSeries jets.

April 4, 2017

The department ruled in a preliminary decision that Bombardier benefited from improper government subsidies, which gave the Montreal-based company an unfair advantage when selling south of the border.

The investigation was sparked by a complaint from U.S. aerospace giant Boeing, after Bombardier secured a deal for up to 125 of its CS100s with Delta Air Lines in April 2016.

The list price for the planes is around $6 billion, but the actual amount of money involved in the deal has not been made public and Boeing alleges Bombardier offered them for much less.

October 13, 2016

The financial penalties aren’t officially due until Bombardier delivers the first CS100 to Delta, which is expected in the spring. They could also still be dropped or refunded.

The key will be whether the U.S. International Trade Commissions finds that Bombardier-Delta deal actually hurt Boeing’s business, a decision that’s not expected until the spring. (Source: Toronto Star)